Banking in North Ayrshire

Hugh Gaffney Excerpts

Wednesday 14th March 2018 Commons Chamber

[Patricia Gibson]

My hon. and learned Friend leads me smoothly to my next point, although of course we are not just concerned about rural areas—Kilwinning could hardly be called a rural area, by any stretch of the imagination. Her point about the effect on small businesses is extremely important, because we all know that small businesses, which are the backbone of our communities—the lifeblood of our communities, keeping the heart of our high streets beating—work in an extremely challenging retail climate. If local businesses cannot bank their takings at the end of the business day, they incur additional insurance costs. They can either take their cash home with them at the end of the business day—because if the bank goes, there is no night safe—or they drive to the next town to bank their takings. Either way, their insurance costs go up. With businesses already struggling on the edge of survival, that could well be enough to tip several of them over the edge. For that reason, the support of banks in our towns often proves critical for small businesses. Let us not forget that, regardless of their political views, everyone in this Chamber understands the importance of small businesses to keeping our high streets alive.

[Hugh Gaffney (Coatbridge, Chryston and Bellshill) (Lab)]

I welcome this Adjournment debate because three banks are shutting down in my constituency in Chryston, Bellshill and Tannochside. Tannochside has one local bank, built by the community. When those banks opened, it was local workers who built them, and the hon. Lady is spot on about local businesses. The staff of small businesses usually have to take large sums of money, and if the alternative is to go to the post office, post offices are not equipped to take them. This is a very good subject for debate and I thank the hon. Lady for introducing it.

[Patricia Gibson]

I thank the hon. Gentleman for that intervention. I now need to make some progress, because I know that the Minister is keen to respond.

As for those living in the towns affected by the closures, Kilbirnie customers have been advised that the nearest RBS following the closure of their branch is in Largs, a round trip of 18.8 miles; Saltcoats customers have been directed to Irvine, a round trip of 12.8 miles; and Kilwinning customers have also been directed to Irvine, a round trip of 6.8 miles.  That is simply not good enough when one considers that many of those customers do not have access to private transport.  They will be at the mercy of local public transport in all weathers. So the elderly and infirm will be left to fend for themselves as financial and social exclusion—that is what we are talking about—bites in their towns.  The bank closures will mean that the affected communities no longer have access to day-to-day essential banking services. We have heard about the problems of mobile banks. They are not a solution to the problem of the closure of the last bank in town. They are a poor substitute and the people of Kilwinning, Saltcoats and Kilbirnie expect and deserve better.

Banks have shown, and are showing increasingly, that they have no sense of service to our communities. Tonight, I call on the Minister to establish and enforce a guaranteed minimum level of service provision for essential banking services, recognising the importance of continued access to banking for our communities.  Surely, it is now time, given that banks are riding roughshod over our communities with no sense of service or responsibility, for a guaranteed minimum level of service provision for essential banking services to be put in place.

I know that the Prime Minister has said repeatedly that branch closures are operational matters for the banks, but that is not good enough. RBS is still almost 73% owned by the taxpayer, so this is a bitter pill to swallow.  In addition, the UK Government retain all legislative and regulatory powers in respect of financial services, so the UK Government have the authority to call a halt to this devastating round of closures while banks, stakeholders and the UK and Scottish Governments consider how best to take account of the obligation to banking customers and our communities.  Whatever the banks may say, they have an obligation to our communities—a service obligation, a financial obligation and a moral obligation.

The UK Government argue that these are “operational decisions” for banks, but there is a precedent, as the Minister knows, and George Osborne, the former Chancellor, let the cat out of the bag. He confirmed that during his time as Chancellor his consent was sought by RBS about the departure of the former chief executive officer, Stephen Hester.  The UK Government could right now reject any RBS branch closures unless and until impact assessments have been carried out, and should require RBS to ensure that practical and sustainable alternative banking services are put in place before any closures are signed off.

It really is time to call on RBS management to reverse these planned closures.  The Minister tonight has a responsibility to demonstrate that the UK Government are standing up for our communities on this most important issue. The SNP Westminster leader, my right hon. Friend the Member for Ross, Skye and Lochaber (Ian Blackford), has persuaded RBS to reprieve 10 branches across Scotland until impact assessments have been carried out.  I wish those communities well, but it does nothing to soften the hammer blow for the towns in my constituency that face losing their banks and for Kilwinning in particular which will lose its last bank branch.  In the past, the Minister has suggested that customers who are not happy can move their accounts to another bank.  What does he suggest that the people of Kilwinning do, when there is no bank for them to move to within a reasonable distance?

Of course customers are also advised to move their accounts to the post office.  Well, 10 years ago I recall collecting petition signatures to save post offices in my constituency when swathes of them were being closed down in my constituency under a previous Government. Post offices bolted on to the back of the local Spar simply do not provide the range of services or privacy that customers need and deserve.

I appeal in good faith to the Minister to ensure that these closures are halted—that RBS is ordered to halt these closures and carry out full impact assessments on the communities affected. All the communities affected want nothing less, and the people in the towns of Kilwinning, Kilbirnie and Saltcoats deserve nothing less.  Is the Minister going to stand with RBS management, or is he going to stand with the communities affected and the communities of Kilwinning, Kilbirnie and Saltcoats in particular?  I urge him to do the right thing and stand up for our communities.